How and Why CPU Cache is faster than Ram!!!

I am a bit confused about CPU Cache and Ram..It is said that L1 cache is faster than L2,L3 cache as well as Ram because it is smaller and less latency than any one,then why increasing RAM enhances the speed of CPU?

As we will increase RAM, then latency should be longer than small RAM size (e.g less latency of 512MB than 1 GB)…Instead of it we can increase cache size so that all instruction should be executed faster and with less latency, then why more RAM is included.

I think my question is some complex but can some one satisfy me please.

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